Or. Admin. Code § 150-018-0010
Current through Register Vol. 63, No. 12, December 1, 2024
Section 150-018-0010 - Oregon Department of Revenue Tax Garnishments and Orders to Withhold Child or Spousal Support(1) The Department of Revenue is authorized to continuously garnish up to 25 percent of an employee's disposable earnings to recover delinquent state tax debt. Concurrently, a district attorney or the Division of Child Support of the Department of Justice is authorized to request the courts to order the withholding of delinquent and current child or spousal support from an employee's disposable earnings. (2) Under ORS 18.385(4), the maximum disposable earnings subject to garnishment is reduced by an order to withhold wages for child or spousal support under 25.378, 419B.408 or 419C.600 or ORS Chapter 110. Normally, any other existing garnishments would then be limited to 25 percent of disposable earnings after subtracting the order to withhold wages. However, 18.385(6) specifies that, for garnishments to pay state tax debt, the provisions of 18.385(4) do not apply. Therefore, a garnishment to pay state tax debt would be calculated upon disposable earnings and not reduced by an order to withhold child or spousal support. Example 1: Larry has $4,000 per month of disposable earnings. Larry owes delinquent child support totaling $15,000. An order to withhold child support has been granted that requires Larry's employer to withhold a specified amount of $1,400 from disposable earnings.
Larry also owes a state personal income tax debt totaling $5,000. The department has garnished Larry's employer for 25 percent of disposable earnings. The employer would calculate and pay the order to withhold child support and the garnishment as follows:
(A) Disposable earnings - $4,000 (B) Order to Withhold specified amount of $1,400 for child or spousal support - ($1,400) (C) Personal Income Tax Garnishment at 25 percent ($4,000 x .25) - ($1,000) (D) Net disposable earnings to Larry - $1,600 (E) Payment for Order to Withhold - $1,400 (F) Payment for Personal Income Tax Garnishment - $1,000(3) If for any reason orders to withhold wages for child or spousal support and garnishments for state tax debt exceed the disposable earnings of the taxpayer, any orders to withhold wages under ORS 25.378 will have priority over any other legal process, including all garnishments for state tax debt or otherwise (ORS 25.375). The employer will reduce payments pursuant to the department's garnishment as needed. Example 2: Renee's employer has been paying a specified amount of $1,400 from Renee's disposable earnings under an order to withhold child support. The employer now has received a Special Notice of Garnishment from the department that causes a one-time garnishment of 100 percent of Renee's disposable earnings. Since more than 100 percent of Renee's disposable earnings has been attached, under ORS 25.375, the order to withhold now takes priority. The employer would compute and distribute payments under the order and garnishment as follows: (A) Disposable earnings - $4,000. (B) Order to Withhold specified amount of $1,400 for child or spousal support - ($1,400). (C) Personal Income Tax Garnishment at 100 percent but limited to remainder of disposable earnings after order to withhold is paid ($4,000 x 100% = $4,000 less order of $1,400) - ($2,600) (D) Net disposable earnings to Renee - $0 (E) Payment for Order to Withhold - $1,400 (F) Payment for Personal Income Tax Garnishment - $2,600Or. Admin. Code § 150-018-0010
RD 5-1993, f. 12-30-93, cert. ef. 12-31-93; RD 7-1994, f. 12-15-94, cert. ef. 12-30-94; REV 7-1998, f. 11-13-98 cert. ef. 12-31-98; Renumbered from 150-23.185 by REV 8-2002, f. & cert. ef. 12-31-02; Renumbered from 150-23.186, REV 11-2004, f. 12-29-04, cert. ef. 12-31-04; REV 4-2011, f. 12-30-11, cert. ef. 1-1-12; Renumbered from 150-18.385, REV 7-2016, f. 8-10-16, cert. ef. 9/1/2016Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 23.185